India is one of the fastest growing economies in the world. With India soon expected to be the world’s third largest energy consumer, there is an urgent need to get these right: current demand for imported coal, oil, and natural gas is significantly outpacing domestic production, and the country is being forced to spend valuable foreign capital to procure additional energy resources (as of 2015, India imported a substantial portion of its energy - 80 per cent of its oil, 18 per cent of its gas and now even 23 per cent of its coal).
Investing in alternative energy is a long-term solution that will help quench India’s growing energy demands, smartly. Not only will it enable the new government led by Prime Minister Modi to reach its development ambitions and support an expanding economy but it will also bring electricity to those who continue to remain without it.
Investing in alternative energy is a long-term solution that will help quench India’s growing energy demands, smartly. Not only will it enable the new government led by Prime Minister Modi to reach its development ambitions and support an expanding economy but it will also bring electricity to those who continue to remain without it.
BIOMASS
Current Scenario
About 32% of the total primary energy use in the country is still derived from biomass and more than 70% of the country’s population depends upon it for its energy needs. Soon after the Indian Ministry of New and Renewable Energy realised the potential and role of biomass energy, it initiated a number of programs that were specifically aimed at promoting more efficient and cleaner technologies that guarantee maximum economic benefits. Currently, biomass power generation in India is an industry that attracts investments of over Rs.600 crores every year, generating more than 5000 million units of electricity and provides employment opportunities to over 10 million people in the rural areas.
What are some of the major barriers faced?
|
What is Biomass Energy?
Biomass is a renewable energy source not only because the energy in it comes from the sun, but also because biomass can re-grow over a relatively short period of time compared with the hundreds of millions of years that it took for fossil fuels to form. Through the process of photosynthesis, chlorophyll in plants captures the sun's energy by converting carbon dioxide from the air and water from the ground into carbohydrates—complex compounds composed of carbon, hydrogen, and oxygen. When these carbohydrates are burned, they turn back into carbon dioxide and water and release the energy they captured from the sun. Considerations
Energy from biomass is reliable since:
|
wind power
India and Wind Power: The story until now
India’s renewable energy capacity is nearly 13% of total generation capacity. Of the total renewable energy generation, wind energy currently makes up the majority with nearly 70 percent. The country’s 100 GW wind energy potential—almost half of India’s total electricity generation capacity in 2013—reveals tremendous opportunities for solving India’s energy crisis through a resurgence in wind energy installations. Wind energy is also vital to diversifying India’s energy mix and is a viable means to meet demands for clean, affordable energy that creates jobs as discussed in the 12th Five-Year Plan.
According to a working paper published by the NRDC, India’s wind market responds to poor enforcement of Renewable Purchase Obligations (RPOs) and uncertainty about the future of Renewable Energy Certificates (RECs) has reduced lender confidence. The relatively high cost and low availability of debt in India has significantly increased the cost of renewable energy projects, presenting a major barrier to the expansion of the wind market. Conducive land acquisition policies, as in the states of Gujarat and Rajasthan, are vital for attracting investments to the wind energy market.
Despite this, the Indian Wind Energy market has been steadily increasing as shown in the graph below.
According to a working paper published by the NRDC, India’s wind market responds to poor enforcement of Renewable Purchase Obligations (RPOs) and uncertainty about the future of Renewable Energy Certificates (RECs) has reduced lender confidence. The relatively high cost and low availability of debt in India has significantly increased the cost of renewable energy projects, presenting a major barrier to the expansion of the wind market. Conducive land acquisition policies, as in the states of Gujarat and Rajasthan, are vital for attracting investments to the wind energy market.
Despite this, the Indian Wind Energy market has been steadily increasing as shown in the graph below.
The central government also provides the following supportive policies for the wind energy market:
- Income tax exemption on earnings from a wind energy project for 10 years.
Allowable 100 percent foreign direct investment (FDI).
Weighted income tax deduction for in-house research and development activity whereby wind turbine manufacturers may claim 200 percent of the costs incurred (other than for land and building).
solar energy
What is the Indian Government doing to promote Solar Energy?
In 2010, as part of its plan to address the urgent and growing demand for energy by advancing clean energy solutions, the Government of India's ( led by then Prime Minister Singh) Ministry of New and Renewable Energy launched the Jawaharlal Nehru National Solar Mission (NSM or Mission) to promote grid-connected and off-grid solar energy. The goal was to establish India as a global leader in solar energy through policies that lead to the deployment of 100 gigawatts (GW) of solar power by 2022. Since then the solar photovoltaic (PV) power's installed capacity has increased from 17.8 megawatts (MW) in early 2010 to approximately 5,000 MW in January 2016.
Today, the Indian Government led by Prime Minister Narendra Modi have scaled up renewable energy targets, and ever since, they have been enabling regulations that are primarily aimed at:
For these high targets to be met, it was imperative to provide infrastructure, bring in capital and mitigate risks around land issues. For that, the Central Government has done its part by bringing in National Thermal Power Corporation and Solar Energy Corporation of India to be the procurers. The solar park policy created a mechanism to give funds to those states which wanted to buy land and create infrastructure for the mega solar parks. The solar parks that have come for auction till now have been over-subscribed in terms of capacity and fairly significant equity investment.
The Modi government also ramped up its investment target in solar energy to $100 billion, which is a significant increase from an earlier target of $100 billion for all types of renewable energy sources by 2022. As India increases its solar installations at a rapid rate during the second phase of its Mission, an opportunity exists to increase public support for this potentially transformative energy resource.
The central government has cited job creation as part of its rationale for the Solar Mission. Solar PV is recognized as creating more jobs per unit of energy produced than any other energy source; thus it potentially represents a much needed solution to unemployment in the face of India's burgeoning population and labor force. As India moves toward its 2022 target, the Indian government must not only have a thorough understanding of the employment opportunities created by the solar industry, but also factor in this job creation potential while designing and implementing clean energy policies at the state and national levels. A rooftop solar project in Haryana to power production at a motorcycle factory for the largest manufacturer of two-wheelers in the world and a solar plant in Rajasthan demonstrate the employment potential of solar power
.
Coupled with successful state-level policies in Gujarat and Rajasthan, the Mission has played a pivotal role in making the industry successful. Abundant policy instruments, such as feed-in tariffs (FiTs) and accelerated depreciation (AD), have been deployed at the state and national levels. These instruments have been vital to the rapid scale-up achieved by this industry so far and are now ready for adoption on a wider scale.
Today, the Indian Government led by Prime Minister Narendra Modi have scaled up renewable energy targets, and ever since, they have been enabling regulations that are primarily aimed at:
- Demand creation
- Improving the quality of the off-take of power through power purchase agreements (PPAs), which as of now is not very bankable, given the financial status of the distribution company in India.
For these high targets to be met, it was imperative to provide infrastructure, bring in capital and mitigate risks around land issues. For that, the Central Government has done its part by bringing in National Thermal Power Corporation and Solar Energy Corporation of India to be the procurers. The solar park policy created a mechanism to give funds to those states which wanted to buy land and create infrastructure for the mega solar parks. The solar parks that have come for auction till now have been over-subscribed in terms of capacity and fairly significant equity investment.
The Modi government also ramped up its investment target in solar energy to $100 billion, which is a significant increase from an earlier target of $100 billion for all types of renewable energy sources by 2022. As India increases its solar installations at a rapid rate during the second phase of its Mission, an opportunity exists to increase public support for this potentially transformative energy resource.
The central government has cited job creation as part of its rationale for the Solar Mission. Solar PV is recognized as creating more jobs per unit of energy produced than any other energy source; thus it potentially represents a much needed solution to unemployment in the face of India's burgeoning population and labor force. As India moves toward its 2022 target, the Indian government must not only have a thorough understanding of the employment opportunities created by the solar industry, but also factor in this job creation potential while designing and implementing clean energy policies at the state and national levels. A rooftop solar project in Haryana to power production at a motorcycle factory for the largest manufacturer of two-wheelers in the world and a solar plant in Rajasthan demonstrate the employment potential of solar power
.
Coupled with successful state-level policies in Gujarat and Rajasthan, the Mission has played a pivotal role in making the industry successful. Abundant policy instruments, such as feed-in tariffs (FiTs) and accelerated depreciation (AD), have been deployed at the state and national levels. These instruments have been vital to the rapid scale-up achieved by this industry so far and are now ready for adoption on a wider scale.
Strategies India can adopt to increase demand for renewables
- Aggressively expand large-scale deployment of both centralized and distributed renewable energy including solar, wind, hydro, biomass, and geothermal to ease the strain on the present transmission and distribution system which will provide electricity to more off-grid populations to be reached.
- Introduce policies that are aimed at easing the permitting process and providing start-up capital to promote the exponential growth of renewable energy.
- Accelerate local demand for renewable energy by providing preferential Feed-in-Tariffs (FIT) and other incentives such as accelerated depreciation; tax holidays; renewable energy funds; initiatives for international partnerships/collaboration, incentives for new technologies; human resources development; zero import duty on capital equipment and raw materials; excise duty exemption; and low-interest rate loans.
- Develop large-scale solar manufacturing in India. Promote and establish utility-scale solar and wind generation parks and farms. Also, establish R&D facilities within academia, research institutions, industry, government and private entities to guide technology development. Robust skill training programs focused on clean energy projects should be expanded across the country. Policymakers should consider establishing at least one prominent solar training institute in each region projected to be a hub for major solar activity (e.g., Gujarat, Rajasthan, Karnataka). India's National Institute of Solar Energy ( NISE) could help set up training programs which are similar to other popular wind power generating destinations.
to what extent is india responsible for the current climate change?
Despite being the fifth largest coal reserves in the world, India lags far behind in its average annual coal consumption. The average Indian’s coal consumption is around 20 percent that of the average US citizen, and 34 percent that of the average Organization for Economic Cooperation and Development (OECD) citizen. And yet repeatedly, in international negotiations, India finds itself caught in the middle of debates that pitch economic growth against climate change.
What are your thoughts on this? Who determines the acceptable levels of pollution for each country ? How will they do this? Does a nation state have to necessarily compromise on economic growth to decelerate the negative results that stem from increasing climate change?